Utilities and staples hovering near the top is to be noted. Materials, industrials and financials near the bottom is in-line with our expectations. Tech remaining in the middle is not likely given any general market rally.

Market: XLF (Financials ETF)

Reason for observation: Potential breakdown

Short-term bias: Bearish

Long-term bias: Bullish

The breakdown in financials is becoming more and more likely. Would like to see some price rejection away from that bottom level if bulls are going to have a chance.

Market: XLP (Consumer Staples ETF)

Reason for observation: Change of character

Short-term bias: Bullish

Long-term bias: Neutral

First time staples have shown short-term bullish potential in a few months. However, it just looks like a bear flag forming on the weekly. So expectations shouldnt be for a longer term reversal as of yet.

Industrials and materials were winners for a large portion of last year. However, in 2018, they are showing signs of serious weakness. Charts are pretty much broken and their relative performance is taking a nose dive as shown in the chart.

The consumer discretionary/consumer staples ratio backing off a bit with strength in staples over the past two weeks.